What type of organization is typically created to benefit a specific group or community through insurance?

A fraternal organization is established primarily to provide insurance benefits and services to its members, who are often part of a specific group or community, such as members of a religious faith, a labor union, or a social organization. These organizations typically operate on a not-for-profit basis and are designed to offer their members various forms of insurance, such as life insurance, health insurance, or accident insurance, while also fostering camaraderie and mutual support among members.

Fraternal organizations differ from commercial insurance companies, which are profit-driven entities focused on delivering insurance products to a broader market without the strong community ties seen in fraternal groups. Non-profit organizations have a broader mission that may not specifically include providing insurance benefits, while risk retention groups are created to provide liability insurance among their members with shared risks. Thus, a fraternal organization's focus on serving a defined group aligns it closely with the concept of enhancing member welfare through insurance services.